Transcript

1.
ITIL Through the Looking Glass
What we can all learn from scaling down ITIL
Rob England
Two Hills Ltd
May 2006
Version 2
Making large-organisation best practices fit in Small to Medium Enterprises
takes us into an Alice-in-Wonderland world where nothing is quite the same.
What loomed large has vanished and what was trivial is suddenly enormous.
In Timothy Leary fashion [you kids look him up on Google] we can learn
much about our everyday reality by getting outside it for a change. "Trip
out" with this presentation and see your own Service Management world in a
whole new way.

2.
ITIL Through the Looking Glass
If you want to make your own notes:
Down the rabbit hole: small business is different.
Owner/managers
Risks
Strategy and planning
Process
Sources of IP
Village culture
Specialists
Tribes
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ITIL Through the Looking Glass
Service Level Management
Change
Configuration
Other processes
No tribes
Takeaways
Taking it to the business
Cultural fit
Best practice as a sacred cow
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ITIL Through the Looking Glass
Introduction
This paper seeks to bring a new perspective to those using ITIL by looking at
it from the point of view of SMEs, on the theory advanced by the likes of
Timothy Leary that altered perceptions teach us about ordinary reality. Put
another way, an insight into my world may show you something you can use
in your day job. We will look at the differences, then at what small
businesses need from ITIL, and finally what Two Hills thinks ITIL looks like to
meet those needs. We close by highlighting a few points that may be useful
to you working with ITIL in the corporate world.
Down the rabbit hole: small business is different.
We will focus on Small Business, defined by the NZ government 1 as those
with less than 20 employees. These organisations have some special
characteristics. When we shift from a corporate to a SME perspective, things
get weird. What was small now looms large. What matters to corporates is
now irrelevant.
Here are some differences:
Owner/managers
Foremost is that most are managed by their owners, who are generally
“amateur” managers.
Risks
SMEs take daily risks that would appal corporate managers. This stems in
part from the entrepreneurial nature of the managers, but more from
necessity: there simply are not the resources to devote to risk mitigation.
Telling a small business owner that they should address a particular risk is
like telling a wartime bomber pilot to give up smoking.
Strategy and planning
The lack of strategy and planning is amazing to those used to the corporate
world. “The root cause of either small business failure or poor performance is
almost invariably a lack of management attention to strategic issues” 2 .
Some owner/managers are not even aware of the deficiency; others just
have more pressing priorities. “SMEs are likely only to undertake formal
planning when faced with some major change or crisis.” 3
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ITIL Through the Looking Glass
Process
One reason small businesses don’t plan much is the competitive advantage of
being flexible and nimble.
“Recent research has shown that clear links between an organisation’s
approach to strategic planning and its business performance exist in small as
well as large organisations… However these findings leave SMEs in particular
with the challenge of matching the requirement for an improved strategic
planning processes [sic] with the competitive advantage associated with
being a ‘simple’ and highly responsive organisation” 4 .
“Formal planning among successful entrepreneurs was rare, at least in the
early stages of their business development. ….. their greatest contribution to
their business venture was the ability to provide vision and focus.” 5
Not only are many small businesses culturally opposed to process (“red
tape”), but it actively undermines one of their key competitive differentiators
over their larger competitors: agility.
Sources of IP
SME owner/managers listen to customers and peers, not consultants. One
survey reported 83% of sellers getting small business customers thru
referrals. 6 In a Canadian government survey 7 “When asked to rate various
information sources in terms of their importance to their business as a source
of business information, [small] business managers pointed most often, by
far, to ‘informal’ sources – their clients, suppliers and colleagues:
86% identified clients as important (most say very important)
73% suppliers
56% business managers and colleagues
“Business managers were divided in terms of the importance of three other
potential sources – banks and other financial institutions, industry or trade
associations, and the media. Approximately equal numbers view these as
important and unimportant. For all other potential information sources, more
people gave low ratings than high ones. Private sector consultants ranked
lowest.” Lower than politicians.
Village culture
Organisational structures tend to be informal and dynamic. Communications
are equally informal and ad-hoc. People sit together and eat together.
Decisions are more consensual (people have to get along).
In comparison, corporate culture looks more like city culture - impersonal,
hustling and abrasive - and small business people tend to take the same view
of it that rural people take of the city.
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ITIL Through the Looking Glass
Specialists
Knowledge tends to be “broad and shallow”. Few have the luxury of
specialising except in critical operational areas that differentiate the
company.
If we ask an organisation to spend 5% on a new process, e.g. quality
management: in a large organisation that means allocating 5% of the
people; in a small organisation that means 5% of the existing staff’s time.
Those people will not be able to apply themselves totally to making a study
of the new discipline. They will find an hour or two a week for it.
Tribes
There are several rules-of-thumb of group dynamics that say a group of
people will split into two when it reaches somewhere between 20 and 100
people depending on the theory. A small business of less than 20 people
does not usually suffer from “us and them” – at least it does not need to. In
particular, there is almost never an IT unit as a distinct person or group,
unless it is outsourced to an external service provider.
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ITIL Through the Looking Glass
What small businesses care about
Large corporates could be characterised as caring about profit, market-share
and risk-control; and government characterised as pursuing policy
compliance, public service and allocation of funds. What do small businesses
care about?
Costs
Small businesses are typically chronically short of time and money. Contrary
to popular belief, SMEs are in many ways quite in-efficient, because of the
lack of economies of scale and the lack of specialisation and process
optimisation.
They make up for it by minimising costs in general and waste in particular (it
is the owner’s money), and by doing entirely without some processes (see
Risk).
Growth
Small businesses are often characterised as being happy just the way they
are but this is generally not so. In the same Canadian survey, “88% said
that growth or expansion over the next few years was important to their
business (55% said very important)”.
Survival
Small businesses typically operate on narrow margins and low cash reserves.
They lack the diversity and momentum of larger businesses. They are tossed
about on the seas of change, and often are completely absorbed in just
staying afloat.
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ITIL Through the Looking Glass
Least practice
What does best practice mean to small businesses? Often: not much.
For any methodology to work for them it needs to be three things:
Achievable
They do not have the resources to implement best practice everywhere. A
misguided pursuit of best practice can wipe out a business by diverting
essential funds and distracting key people. Best practice is only useful to
SMEs where they are:
• Highly competitive industries that differentiate on quality. The classic
example is of course the motor vehicle manufacturers, the origin of a
lot of the theory of Best Practice.
• Using complex processes that need improvement: where existing
processes are as extensive as Best Practice ones, but sub-optimal in
design. They may never have been designed but rather grew
organically. Re-engineering them will bring efficiencies that pay for the
effort.
• Service providers who deal in life and health: medicine makers, medical
centres, rescue services, social welfare. Even in this instance, it is the
core services that must be delivered to Best Practice. Many of these
organisations are chronically under-resourced and so something other
than best practice should always be a considered option for ancillary
and supporting processes.
• Providers to clients or partners, who require compliance to a Best
Practice standard.
• Dangerous or unpopular industries: aerospace, aircraft, nuclear power,
chemical engineering, fuel storage, genetic engineering, explosives.
Even in situations where human life is not endangered the public
relations risk of an error is too high.
In all other cases, SMEs are generally too resource-constrained and
pragmatic to find a business case for best practices.
It may not have escaped your notice that this argument applies to start-ups
and resource-constrained organisations of any size. Very few start-ups are
so well funded that their systems can be anything more than the bare
minimum needed to get off the ground. Once the business has got past the
initial cashflow trough and revenue starts to stabilise, only then do they have
the leisure of improving process. They run the risk of destabilising the
business again unless they are careful to work on processes only in domains
that will deliver a sufficient benefit to the business.
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ITIL Through the Looking Glass
Likewise, many organisations know what they would like to be doing but
don't have the resources to do it. Ill-conceived attempts to pursue best
practice at this time could destroy the business rather than helping it.
Applicable
Many methodologies, including ITIL, have aspects that are not applicable to
SMEs:
• They set out to be comprehensive and end up being large and
complex. They do not scale down. The new ITIL “small-scale” book 8
suffers from this. It will work for small corporates; it will struggle for
acceptance among small businesses.
• They focus on doing things right, and assume continuous
improvement. Small businesses stop at “good enough”.
• There is a plethora of roles. The answer is usually that people take on
multiple roles, but in a small business someone might end up wearing
ten hats, which is ridiculous even when figuratively speaking.
• They take a lot of time. It is entirely conceivable that a small
business will devote one person for two hours a week to implementing
a methodology. What can be achieved in 100 hours a year?
• They require expensive external consulting.
• The whole concept of aligning IT with the business is mystifying to a
small business (see Tribes), except where IT is outsourced to an
external provider.
Acceptable
Small business culture is different. Something like ITIL alienates many small
business people:
• Formality is seen to stifle flexibility and creativity. We need to
“lighten up”.
• Prescription rather than guidance. As Craig Pattison put it: “they
want an Auntie not a Mum”.
• Paperwork. Small business people communicate by looking up from
their desk.
• Adversarial nature (SLA negotiation, incident manager vs problem
manager …).
• Management by measurement. Small businesses prefer to manage
people on intuition and feelings.
• Perfectionism over pragmatism. Small business needs to “do it’ll-do”.
• Jargon, biz-speak and verbosity.
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ITIL Through the Looking Glass
• Learning curve: a big body of underpinning theory. Small businesses
just want the answers.
• Time and money commitment. We need to get real.
• Use of specialist consultants (“suits”).
• Measurement against benchmarks: a judgemental approach rather
than a supportive one. All small businesses will fall short so they
need to be encouraged to achieve whatever they can.
• Technology centric. This is not an ITIL failing, but a lot of other
advice for small businesses in the IT arena is totally fixated on what
technology they should have and how it goes together. No: all small-
business-specific IT-advice does this. It is geeks mis-communicating
with entrepreneurs and wondering why nobody listens.
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12.
ITIL Through the Looking Glass
The BSF Common Sense Filter
Two Hills has come up with a set of 14 transforms
BSF: Common Sense Filter
for filtering IP so that whatever comes out the
other side is achievable, applicable and acceptable 1. No Separation. “IT is the
business”
to small business. We call it the BSF.
2. Rationalisation of roles.
What does ITIL look like thru the BSF? This “too many chiefs”.
audience will be waiting for the answer to this 3. Rationalisation of
question. workload. “cut the red
tape”
4. Evolution over
certification. “boosting
Service Level Management not bashing”.
SLM not about us and them: there is no “tribal 5. Top-down thinking. “out
effect”. So there is less measurement and of the weeds”
reporting and more defining the catalog and 6. Pragmatic technology.
focusing efforts on services. We prefer to call SLAs “police the geeks”
Service Level Definitions. Awareness of the 7. Translation. “plain
service-centric mentality is important. So too is English”
awareness of the need for planning. 8. Discovered alternatives.
“horse’s mouth”
9. Measurement dilemma.
Change “fact meets feelings”
We have boiled Change Management down to a 10. Informal freedom.
“lighten up”
change log, a CAB, and moving the organisation
through Pink Elephant’s three levels of change 11. Depth.
maturity: 12. Process centric.
• Know about changes 13. Occam’s Razor
14. Rule of 3
• Know about them before they happen
• Have a say in whether they happen
Configuration
This will generate debate, but we think pragmatism dictates that
Configuration Management boils down to a financial asset register and the
rest stored as “him over there”: all the relationships and impact analysis are
in someone’s head.
Other processes
In general processes are stripped of much formal process. Most of the other
processes focus on having an Owner, making plans, aligning the process with
the business strategy (and the need to have one of those), and making
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14.
ITIL Through the Looking Glass
Takeaways
Taking it to the business
In this small-business model, many ITIL processes reside in the business
(something we are just starting to see in the corporate world too). Perhaps
small business can show the way to bringing Service Management to the
whole organisation.
CEOs consistently list dealing with change as one of their top issues. Why
don’t they have a Chief Change Officer? Why does the Change Manager sit
somewhere one or two levels below the CIO?
If “IT is the business” why doesn’t the COO run IT production?
Most of all why not peel Service Management off from IT and provide it as a
distinct discipline within the business? We are seeing it commonly with
service desks: we will see it more often with the whole SM domain.
Cultural fit
Small businesses are not the only environment where the implied ITIL culture
does not fit. Look at your own organisation’s culture (the way we do things).
Perhaps less emphasis on management by numbers would help acceptance of
ITIL, for example.
Best practice as a sacred cow
It is taken as a given that organisations want to achieve best practice in
everything they do and an organisation that doesn't is somehow less worthy
than those that do. This should not be the case.
Pursuing Best Practice is a strategic decision, which should be taken when
there is an agreed ROI (tangible or intangible) for the resource investment
required to get there. Not everyone can afford or wants best practice.
We fully support best practices for those organisations that have the
commitment and resources and reason to adopt best practice. For those who
do not, something more pragmatic is required, which can be distilled from
best practice as well as from legislative requirements and other sources.
That is what Two Hills is working on. Watch this space.
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ITIL Through the Looking Glass
1
SMEs in New Zealand: Structure and Dynamics – 2005
http://www.med.govt.nz/templates/MultipageDocumentTOC____2806.aspx
2
The performance and competitive advantage of small firms: a management perspective,
Jennings and Beaver, International Small Business Journal 15(2), 1997
3
Business Strategy – do SMEs face special problems?, Frizelle, Institute for Manufacturing,
University of Cambridge, MANUFACTURING INFORMATION SYSTEMS: Proceedings of The
Fourth SMESME International Conference http://iprod.auc.dk/sme2001/paper/frizelle.pdf
4
Balanced scorecard implementation in SMEs: reflection in literature and practice, Andersen,
Cobbold and Lawrie, 2GC Ltd, SMESME Conference, Copenhagen, May 2001
5
Planning and Growth Characteristics of Small Business Owner-Managers, Mazzarol, Centre
for Entrepreneurial Management and Innovation (CEMI), University of Western Australia
6
November 2005 Survey “Selling to Small Businesses”, www.smallbiztrends.com
7
Small Business Information Needs Assessment Survey: Report to Industry Canada,
February 2001
8
ITIL Small-scale Implementation, Office of Government Commerce, The Stationery Office
Books, 2006
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